§ Mr. StonehouseI beg to move Amendment No. 18, in page 6, line 28, 204 leave out from 'provide' to 'and' in line 29 and insert 'data processing services'.
Mr. Deputy SpeakerWith this Amendment, we can discuss Amendment No. 19, in line 29, leave out 'or relate to their 205 use', and Amendment No. 117, in page 65, line 45, at end insert:
(3) Any reference in this Part of this Act to data processing shall be construed as including a reference to the storage and retrieval of information.
§ Mr. StonehouseThe House will remember that when we discussed the last Amendment I indicated that I had been persuaded by the observations of hon. Gentlemen in Committee, who put a point of view to me which I undertook to consider. Similarly on this issue, I have been persuaded by the observations of hon. Gentlemen who contributed to the discussion on 12th December. Members of the Committee will remember that the hon. Member for Totnes (Mr. Mawby) moved an Amendment on that day and was supported by the hon. Member for Walsall, South (Sir H. d'Avigdor-Goldsmid) and the hon. Member for Nelson and Colne (Mr. Waddington).
Those hon. Members suggested that Clause 7(1)(c) was too wide and that some Amendment was required to the Clause. I have considered the position, the original wording was designed with the intention of catching all the activities of the National Data Processing Service, but, as I indicated to the Committee, it was not intended to go beyond that.
I believe that the words I am now proposing to the House achieve the same objective, but with greater clarity, and is an improvement to the Bill. As I indicated, I am responding to the observations made in Committee, for which I am most grateful to the hon. Gentlemen to whom I have referred.
§ Mr. MawbyI am extremely grateful to the right hon. Gentleman for his concern and the way in which, clearly, he has studied what was said in Committee. Obviously, he has sought to narrow the wording to make certain that it does not go outside the data processing services.
The right hon. Gentleman said that he had no intention of going any further than giving permission for the data processing services to continue in operation. Unfortunately, the wording which he proposes is capable of all sorts of interpretations. In the future, the majority of people will say not what the Minister assured the House but what the Act says, and the difficulty lies in the words 206 "data processing services." It means to the right hon. Gentleman and to myself what we think it means, but to others outside it might have a much wider interpretation.
12.30 a.m.
We have a computer industry in which all sorts of jargon is used. The majority of that jargon has not yet been interpreted and decided by the courts. In the absence of the Attorney-General, I should say that, whatever jargon the computer industry may use, the actual words used could mean that a court of law would rule that a Press cutting agency, Scotland Yard or the department of a bank which issued bank statements would qualify as data processing services. I do not suggest that the Post Office has any intention of entering into any of these areas. Nevertheless, the words could be interpreted as such, and data processing could take us a long way.
When I notice that Amendment No. 117 is being discussed with this matter, it causes me more concern. Amendment No. 117, which affects Clause 84, seeks to insert:
(3) Any reference in this Part of this Act to data processing shall be construed as including a reference to the storage and retrieval of information.It is obvious that that form of words will be necessary, because a data processing service must carry out the storage and retrieval of information. The difficulty, in my opinion—again in the absence of any Law Officer of the Crown—is that the courts are likely to interpret that definition much wider than we would define it for the purposes of the Bill. When we start thinking about storage and retrieval of information, we realise that it is a very comprehensive statement. It could include office equipment, such a filing cabinets, dictating machines, tape recorders, and cupboards, not to mention libraries, warehouses, and even the time-honoured abacus. These are all capable of being interpreted by the courts as being methods of storage and retrieval of information.I do not want to appear churlish to the right hon. Gentleman. I believe that he has seriously considered the points that we made in Committee. He has brought in Amendments which, in his opinion and that of his Department, are the minimum necessary to make certain 207 that the data processing service should continue. All I am saying is that the courts could interpret this more widely than he or I would. Therefore, it is important that we should ask whether there is some way in which we could narrow the definition still further so that the Bill will be more in line with what the House seeks to do.
§ Mr. HayI rise briefly to support what has been said by my hon. Friend the Member for Totnes (Mr. Mawby).
The Postmaster-General has made an honest and genuine attempt to put right the defect in the Clause, but I entirely agreed with what my hon. Friend said concerning the rather limiting effect of the words now proposed to be used. It seems to me that there might be trouble if, at some time in the future, the Post Office Corporation decided to go into some form of activity which it could describe as data processing, but which is clearly not in the mind of the Government or the House at the moment.
I do not want to be too legalistic about the difficulty that I see in the Amendment No. 117, but it does not describe what data processing is. It merely says what the expression "data processing" shall include. If the draftsman could devise a definition of exactly what is meant by data processing rather than saying it has to be construed as including a reference to the storage and retrieval of information, I should feel much happier.
Clearly what the Post Office is concerned with is something in the electronic field involving the transmission of information, the collection of information at some central point, and its distribution to other places. It is obviously in mind that computers will be used, either centrally or at different points. Although it is too late now to try to redraft the proposed Amendment, there will be an opportunity in another place for these words to be looked at again, and I simply put the suggestion to the right hon. Gentleman that in these circumstances he might consider asking the draftsman to include a reference to "electronic". I think that that is what the Government have in mind for the ambit of the data processing service.
§ Captain OrrI think my hon. Friend will agree that it will have to be even 208 more limited than simply "electronic", because as they stand the words "storage and retrieval" would include such things as tape recorders.
§ Mr. HayI was trying to think not just of the definition in Amendment No. 117, but of the whole problem which is here exposed, that of paragraph (c) and its related definition in Clause 84.
I have put forward my suggestion with the intention of being helpful, because in some years from now the meaning of the words could well be very much wider than we intend here, and certainly much wider than the Government, even looking to the future, would imagine is necessary. We want to find a proper definition. The right hon. Gentleman has done stage one of the redraft. I hope that he will not weary of well doing, but will go further and look at this again in another place.
§ Mr. Stratton MillsI think that the House should be grateful to my hon. Friend the Member for Totnes (Mr. Mawby) for drawing attention to this matter because, to use my hon. Friend's words in Committee, there was no doubt that the words in the Bill were
far too wide and capable of a very broad interpretation.As my hon. Friend the Member for Walsall, South (Sir H. d'Avigdor-Goldsmid) said in Committee, they weredramatically far reaching".—[OFFICIAL REPORT, Standing Committee D, 12th December, 1968 c. 283–4.]I think that the right hon. Gentleman has gone some way towards meeting our point. He has given us half a loaf, but not a complete roll. It would be churlish not to express our thanks for what we have received, but having done that I should like to reinforce what was said by my hon. Friends the Members for Totnes, and Henley (Mr. Hay), that we should not leave the Clause as it is.In Committee the right hon. Gentleman reminded us that at present the national data processing service does about 10 per cent. of outside business, and that this proportion is expected to grow. If this service is to mushroom as a nationalised industry, I think that it would be wise to look with great care at the power that it has. I ask the right hon. Gentleman to confirm that only matters covered by 209 the Post Office (Data Processing Service) Act are included in the Amendment and that it goes no further.
Some of my hon. Friends have referred to a point covered in a letter by John Gorst in The Times on 28th April. Referring to the definition of data processing, he wrote:
there can be no doubt that a Court of Law would rule that a press cutting agency, Scotland Yard, a telephone answering service, the editorial department of a newspaper or the department of a bank which issued bank statements—all would qualify as data processing services. Under … a future Post Office administrationtheywould be entitled to be involved in these activities.I should be obliged for the right hon. Gentleman's comment on that.I am most unhappy about Amendment No. 117. The words:
Any reference in this part of this Act to data processing shall be construed as including a reference to the storage and retrieval of in formationare an unsatisfactory definition. In his letter to The Times Mr. Gorst wrote thatthe definition of 'data processing—the storage and retrieval of information'—is so comprehensive that it includes innocent office equipment, such as filing cabinets, dictating machines, tape recorders, and cupboards, not to mention libraries, warehouses and even the time-honoured abacus.It seems, therefore, that, while the right hon. Gentleman has gone some way to meet us, the drafting of the Amendment is not entirely satisfactory. It would be very useful if the right hon. Gentleman could reply to the points that have been put in the debate before we let is pass.
§ Mr. StonehouseI am grateful to the hon. Members who have contributed to the discussion. I am also grateful to the hon. Member for Belfast, North (Mr. Stratton Mills) for the questions which he has put to me.
The hon. Member asked whether the wording in the Bill as amended by the Amendment gives the Post Office greater powers than are set out in the Post Office (Data Processing Service) Act, 1967. Yes, because the Act referred to the provision of services and facilities for the processing of data by computer and under the Bill there is no limitation to data processing by computer, because it opens the opportunity for new and more sophisticated 210 equipment, if that should be invented, to be used by the National Data Processing Service.
§ Mr. Stratton MillsWhat would the answer to my question be with the Clause as originally drafted?
§ Mr. StonehouseThe answer would have been the same because it was the intention in the Bill as originally drafted that there should be no restriction on the National Data Processing Service to provide data processing services in the widest sense.
As to the other point raised, the House must appreciate that this is not a monopoly service. It is a service provided by a section of the Post Office in competition with many other businesses. In these circumstances it would be wrong of the House to shackle the Post Office Corporation in a particular way. This is why we are seeking in this drafting of this subsection, as we were seeking in the original drafting, to give the fullest opportunity to the National Data Processing Service to do a job for its customers, who are obtained in fair competition with other suppliers of such services, without unnecessary restrictions being placed on their activities.
§ 12.45 a.m.
§ Captain OrrThe Postmaster-General has said that the N.D.P.S. is not a monopoly service and exists in competition. But under the monopoly Clauses of this Bill it would be possible for it to become a monopoly service.
§ Mr. StonehouseNo. There is no question that this would become a monopoly service because the facilities of the telecommunications section of the Post Office are available, freely and without any discrimination, to other providers of data processing services. Therefore, at present and in the future, the N.D.P.S. will not be in any privileged position in that respect. It will be competitive.
§ Mr. HayI am following the right hon. Gentleman's argument with the greatest of care. May I direct attention to Clause 24(1)(c) which provides for a monopoly of telecommunications and refers in particular to
signals serving for the impartation (whether as between persons and persons, things and things or persons and things) of any matter 211 otherwise than in the form of sound or visual images …If the right hon. Gentleman is saying that the data processing service is a service that the Post Office will carry on and that other people may carry on exactly the same kind of service in competition, how does he tie up that statement with the very wide powers that it is proposed to be taken in Clause 24(1)(c)?
§ Mr. StonehouseIt ties up very well. What Clause 24(1)(c) refers to is the telecommunications monopoly which the House has agreed should go to the Post Office Corporation as it at present exists in the monopoly of the Postmaster-General. But the telecommunications monopoly will be providing services to a whole range of customers; N.D.P.S. will be one of them, in fact. The National Data Processing Service and the other competitors providing data processing services will have equal access to the telecommunications facilities provided by the Post Office. Any suggestion there may have been in any quarter that the Post Office would discriminate against other data processing services in favour of the National Data Processing Service is completely and utterly wrong. There will be no question of any such discrimination.
§ Mr. HayI am sorry to intervene again, but this is important. Is the right hon. Gentleman saying that if other people who operate data processing services for hire wish to acquire, for example, the use of land lines from point to point, from the telecommunications monopoly of the Post Office, there will be no discrimination against them and there will be no necessity for them to obtain licences under Clause 27?
§ Mr. StonehouseNo, I am not suggesting that at all. It is important that the monopoly, as I have indicated on past occasions, should be protected. The facilities and the hiring of the lines will, of course, be available to any data processing service. It will be able to buy the facilities in the same way as the N.D.P.S. will be buying them from the Post Office. The question of discrimination will not apply.
I was also asked about information retrieval and why we have put down 212 Amendment No. 117. This is consequential on Amendment No. 18, because the definitions of data processing in the technical glossaries do not explicitly refer to the storage and retrieval of information and I considered it wise, in order to remove any doubt, to include these words in the Bill so that, in future, there would be no doubt about the matter. The importance of information retrieval to data processing must be made quite clear to the House. It is an essential part of such services and that why it is important to put the matter beyond doubt in the Bill.
§ Amendment agreed to.
§ Mr. Kenneth Baker (Acton)I beg to move Amendment No. 20, in page 6, line 35, at end insert
and shall receive payment for such services at rates to be agreed between the Post Office and the Treasury'.The Amendment concerns the method of assessing the charges which should be made by the Post Office for the various services it runs mainly for other Government Departments. There is some confusion in the Bill as to how it should be done. In the Post Office Accounts, the Comptroller and Auditor-General says that the basis for making the charges was cost-plus. The services are those like distribution of pensions and family allowances and the collection of water rates for local authorities.In Committee this policy had apparently been changed and the right hon. Gentleman reacted well to pressure from the Opposition that the services should be charged on a realistic basis and contain an element of profit to the Post Office. He said that the same basis for calculating Post Office profits was to be used—for example, that, when the Department of Health and Social Security asked him to distribute pensions, he would charge cost-plus and also 2 per cent., which would be the element of profit. This is something that on the whole we support.
But some of the services involved the use of the telecommunications side of the Post Office on which the profit element is 8 per cent. on assets. So the formula proposed by the right hon. Gentleman in Committee is not satisfactory. We have devised the Amendment to try to meet the objections. We 213 want to know how these various charges will be assessed and where the responsibility will lie.
No mean sum is involved. The Post Office receives about £50 million a year from various Government Departments for carrying those services out and there is no way of checking, other than taking the right hon. Gentleman's word, whether this is cost-plus or cost-plus 2 or cost-plus 8. We suspect that it is nowhere near the true recovery.
When the Post Office becomes a nationalised industry, a corporation, with the obligation to act commercially and make a profit, it may well be asked by other Government Departments to carry out services which may or may not be profitable. Under the Bill, it will be in a difficult position. The level of charges can be decided by the new Minister of Posts and Telecommunications in conjunction with the various Government Departments. This is not satisfactory because so many other Government Departments are represented in the Cabinet while the Post Office is not. Whenever there is a conflict, the Postmaster-General will lose, as the strikes showed, when he wanted to take one course and some of his Cabinet colleagues bullied him into saying, "No." We do not want this to happen in the assessment of these charges, so we have suggested that the Treasury, whose services are rarely conducted by the Post Office, should hold the ring.
What recovery should the Post Office get when other bodies, like local authorities, use its services? We believe that it should be a commercial rate. The Assistant Postmaster-General was quite prophetic in Committee, when he said:
… there are unlikely to be many instances where the amounts to be paid to the Post Office cannot be settled satisfactorily by negotiations between it and the principal concerned … some provision must be made in the Bill to meet the situation … of deadlock being reached in negotiations. Not even an Act of Parliament can compel people to agree; we have found this on the trade union side."—[OFFICIAL REPORT, Standing Committee D, 28th January, 1969; c. 506.]It is not often that the hon. Gentleman is called a prophet. But a conflict of interest can arise between Government Departments and we suspect that, in the past, the Post Office has come out of it badly, and the social security Ministries have found perhaps too cheap a way of 214 distributing their payments. This should be tightened up.The Amendment also covers services in the nature of a social duty but which are nevertheless expensive—telegrams, which cost £2 million, and remote telephone kiosks, for example. If these are to be accepted, their cost should be determined and borne as a subsidy. A nationalised industry should not have to carry these services without their being separated and clearly listed so that we can assess the Corporation's true profitability. The Amendment is meant to be helpful, and to put the Corporation in a clear and unequivocal position.
§ 1.0 a.m.
§ Mr. Eldon GriffithsI support my hon. Friend the Member for Acton (Mr. Kenneth Baker) on a point of principle. We must know what things cost. There are far too many services and activities of Government Departments of which the public and the House do not know the cost. There are subsidies, allowances, and tax deductions, and so on, and it is difficult to get a straight accounting, particularly in the nationalised sector. The Amendment would require the cost to be assessed, charged to the user and, above all publicised, so that we all knew the bill.
Although we are not dealing with Clause 12, the Amendment has a bearing on that provision, which, in stating the charges that may be made, specifically refers to game permits and dog licences—we know why the right hon. Gentleman wishes to include those—although it does not specify the charges made for the general category of services provided by post offices throughout the country.
Although I was not a member of the Standing Committee, and cannot pretend to be expert in these matters, I can examine the general services provided by the Post Office as outlined in the Report and Accounts of the Post Office. One service is the administration of broadcasting. One section of the Post Office is sending round vans to check on who has or has not paid the various licence fees. How much is this costing? This cost should be identified—perhaps this service is costing more than it is collecting—and the Amendment would result in it being identified.
215 Some time ago this House passed legislation which has resulted in men being sent round to suppress pirate radio stations. I regard that as a squalid activity on the part of the Post Office. [HON. MEMBERS: "Oh."] It is squalid for young people in various parts of London and elsewhere to be treated in this way. Why should we suppress their free enterprise radio activities?
§ Mr. Joseph SlaterThe hon. Gentleman used the phrase "squalid activity". I trust that he will withdraw it, in view of the international obligations which the Post Office has.
§ Mr. GriffithsI dislike disagreeing with the hon. Gentleman, for whom I have much admiration, but I will not withdraw it. I said it when the legislation was being passed and I repeat that it was a squalid activity of which the Government should be ashamed. I await the day when free enterprise broadcasting will be restored.
§ Mr. Roy Roebuck (Harrow, East)Is the hon. Gentleman suggesting that the international obligations of this country should be ignored by the Government?
§ Mr. GriffithsI am suggesting no such thing.
§ Mr. Ian GilmourIs the hon. Member for Harrow, East (Mr. Roebuck) aware that it is unwise for him to talk of international obligations in this matter when these very obligations were ignored by hon. Gentlemen opposite for at least two years while they got over a General Election?
§ Mr. GriffithsI am well aware of what my hon. Friend has in mind. The hon. Gentleman's comments are not worth answering. In any event, it would be perfectly simple to renegotiate the European Broadcasting Convention, which is what the Government should have done. Instead, they placed a squalid activity on the Post Office.
§ Mr. RoebuckIs the hon. Gentleman now speaking authoritatively for the Opposition? Is he making the promise that if the Conservatives are returned to power, they will renegotiate the Convention?
§ Mr. GriffithsIt is not for me to speak on behalf of the Official Opposition.
§ Mr. RoebuckAh.
§ Mr. GriffithsI had the pleasure of proposing at a conference of the Conservative Party that we should have national broadcasting legislation designed to introduce a sensible form of private local broadcasting. I am glad to say that my right hon. Friend who speaks on broadcasting matters for the Opposisition accepted that proposal, which is, I understand, part of the policy of the next Government. I feel that I should not be diverted from my theme by these little interventions.
§ Captain OrrI am sorry to make another little intervention, but will my hon. Friend address his mind to the question of who is to administer these new services in relation to broadcasting? Will it be the new Corporation or the residual Ministry?
§ Mr. GriffithsI do not think that I can answer my hon. and gallant Friend's question. I am concerned with the Amendment and what it would achieve. It would achieve the charging and identifying of that charging in respect of Post Office services. One of the services set out in the Accounts is that administration of broadcasting. It would be right, good business practice, and politically more honest than the present situation if we knew precisely what those costs are and if they could be debated. They could be condemned if they were excessive.
Beyond the administration of broadcasting the general agency services of the Post Office are identified as
the management on behalf of the Treasury of National Savings and the conduct of business therein".That, of course, is an exemplary activity for the Post Office to be engaged in, but what does it cost? The Government have belatedly persuaded to put some confidence into savings. No doubt Post Office expenses in connection with National Savings will go up, but we are entitled to know the cost of running National Savings business. That the Amendment would seek to discover and make publicly known.There is the further general business of the Post Office in family allowances, pensions and benefits and sale of National insurance stamps. We must know what these things cost, have it in the open 217 clear, so that we can examine the efficiency or otherwise with which these important and proliferating services are conducted. It may be that, as we are often told, we have the most efficient Civil Service in the world. Far be it from me to criticise the quality of the Civil Service—it is the quantity I do not like—but we cannot judge the efficiency of the service unless we know precisely what it costs. We cannot do that unless we know what the administration of family allowances, pensions and benefits, and so on, is costing so that we can debate the way in which it conducts this business.
The purpose of this Amendment is to help the Postmaster-General and I hope that he will look at it in that way. Over the last three or four years this kind of Amendment has taken on rather greater and more special urgency. This arises because the functions of government have been massively extended by hon. Members opposite. It was truly said the other day that far too many people are minding other people's business. The Amendment is to find what it costs to mind other people's business. Clause 7 (d) says that the Bill would permit the Post Office
to perform services for Her Majesty's Government in the United Kingdom".That is an all-embracing and prodigious statement when one thinks of the sheer size and complexity of all that the Government are nowadays doing.About 60,000 more civil servants have been taken on by the present Government. I do not doubt that with all the additional legislation with which the Government have burdened us those 60,000 additional civil servants in all their vast new offices are producing vastly more letters, most of them with "O.H.M.S." stamped on them, which the Post Office has to deliver. They are also making many more telephone calls than ever before. The House should have a way of knowing how the additional civil servants and their additional duties are increasing the costs to the Post Office and therefore eventually to the taxpayer. It is because I am so anxious to find out what the increasing cost of Government is that. I support the Amendment.
There is another point of important principle. Unamended, the Clause would permit the Post Office to make charges in respect of what it does for the National 218 Health Service authorities, both local and national. It is proper that the Post Office should give assistance to the Health Service, and we should know what it costs, particularly because the Service is in competition with some of the private health schemes that are becoming increasingly popular as our people are prepared more and more to become self-reliant in medical matters.
This is not a political issue. If the Health Service is to have its services from the Post Office either free or at least at a cost that is not made known to the House, does not that give it a competitive advantage over private health schemes, which must pay the full going rate for the services they receive from the Post Office? The Postmaster-General may say that the Health Service is charged the full rate by the Post Office. If so, let us know it. It is wrong that hidden costs by the Post Office should be charged to the Health Service, both local and national, whereas private health schemes are charged the full amount by the Post Office.
For those reasons I hope that the right hon. Gentleman will accept the Amendment in the spirit in which it has been moved.
§ Mr. StonehouseThe Amendment would cover two ranges of activities by the Post Office on behalf of authorities in the United Kingdom. The first is such that the Post Office would undertake to do by agreement with the authorities concerned. It follows that it would not undertake these activities unless it were satisfied with the rate of remuneration it received. It is the intention that the Post Office should recover from these authorities not only the actual cost of performing these functions, which are extremely important and helpful to the authorities concerned, but also a contribution to the financial objective that it is expected to achieve—2 per cent. on expenditure.
In addition, the Post Office may be directed by the Minister to do agency work which it may not, in its discretion, have been willing to undertake. In order to safeguard the very important activities of certain authorities and Ministries, power is given in Clause 12, to which some Amendments have already been put down, to allow the Minister to direct 219 the Post Office to undertake these activities.
In that case, the point I have made about the first range of activities may not apply. It would be impossible for the Post Office to negotiate an agreed rate of remuneration with the authorities concerned if the Post Office had been directed to do that work against its better judgment and that is why Clause 12 allows, in subsection (7), for the Minister to determine the amount of remuneration the Post Office shall receive in the event of a dispute arising between the Post Office authorities concerned when the Post Office has been subject to a direction from the Minister to undertake that range of activities.
I suggest that this Amendment is not required because the Post Office will be remunerated in a way satisfactory to it or to the Minister, whatever activities it undertakes under Clause 7(1)(d) either by agreement or by determination of the Minister in the event of a direction being given by the Minister on the second range of the activities I have described.
§ 1.15 a.m.
§ Mr. RidleyCan the right hon. Gentleman say how the telegram service would come into these two categories? It is a big lossmaker. I know that he has not finally announced his plans, but I do not see how it is covered.
§ Mr. StonehouseThere are a number of uneconomic activities which the Post Office engages in as part of its broader social obligations. The Post Office has been given a monopoly and it is part of that monopoly responsibility that the Post Office operates services which may, strictly speaking, be considered uneconomic. For example, the delivery of posts to the remoter areas of Wales and Scotland are uneconomic activities as is the provision of kiosks, raised by the hon. Member for Bury St. Edmunds (Mr. Eldon Griffiths). The Post Office should continue to provide these kiosks even though it does not get fully remunerated for them.
§ Mr. Eldon GriffithsThe right hon. Gentleman will know that I frequently write on behalf of rural districts about these problems. If there are to be additional charges arising from uneconomic 220 activities, they should be clearly identified and discussable.
§ Mr. StonehouseIn the last Post Office White Paper, I saw to it that fuller details were provided on these uneconomic activities so that the House would be fully aware of them.
For instance, in columns 929 and 930 of the OFFICIAL REPORT Of the Standing Committee on the Bill, I referred to examples of uneconomic social activities like the delivery of items for the blind, mainly Braille material which the Post Office has been willing to accept and will continue to accept. We also provide a free 999 emergency service, which costs a considerable sum, but I believe that in the light of the monopoly the Post Office has been given it is right it should accept this social obligation. If there are other uneconomic social obligations put on the Post Office, it may be appropriate at some future time for the Post Office to be remunerated in some way through adjustment of its economic objective or by direct cash subsidy to make up for it.
The House would accept that many of the activities of the Post Office which appear to be uneconomic are within the context of the monopoly obligations of this great institution.
§ Mr. Michael English (Nottingham, West)I thought I heard my right hon. Friend say that the 999 service was, and ought to be, a charge on the Post Office. Would it not be reasonable to suggest that it should be a charge upon the police or fire service or ambulance?
§ Mr. StonehouseIt has been a service that the Post Office has willingly accepted and is willing to continue to accept. It is a charge which rightfully falls upon the Post Office.
§ Captain OrrHas the cost of the 999 service been identified?
§ Mr. StonehouseApproximately £500,000.
The hon. Member for Bury St. Edmunds asked how these costs are met. They are met on a realistic basis and the parties concerned pay the actual charge for the running of the service. The hon. Gentleman said that in the past the Post Office came out badly in the provision of these services, and I 221 agree. In the past the Post Office received the actual cost of providing the services, without an addition for the financial objective. More recently it has been provided that the Post Office shall receive an extra 2 per cent., equivalent to the financial objective of this side of the business.
Costs will be shown in the appropriate accounts of the main employing departments. The cost of the savings agency work will be shown in the National Savings Department accounts, the costs of the broadcasting agency work in the Ministry of Posts. There will be ample identification of the costs of providing the services. The Amendment is not needed to secure the objectives that the hon. Member for Acton (Mr. Kenneth Baker) wishes. There will be ample provision for the Post Office to be remunerated for the job that it will do on behalf of these authorities.
I would, therefore, ask the hon. Gentleman to withdraw the Amendment.
Mr. Stratton-MillsMy hon. Friend the Member for Acton (Mr. Kenneth Baker) is to be congratulated on initiating a most useful debate on the whole question of the examination of agency costs by the Post Office, and has enabled us to judge whether the system is likely to be more effective in future than it has been in the past. Although the right hon. Gentleman went some way towards convincing me, he has not fully satisfied me. He reminded us that there was, in Clause 12, power for the Minister to levy costs where a direction was involved, but that in other cases, it has to be reached by agreement between the parties. In Committee, the Minister spoke very revealingly about the past history of these matters. He said:
In the past the Post Office has been subsidising these payments from all the other work it has been doing."—[OFFICIAL REPORT, Standing Committee D, 28th January, 1969; c. 503.]The right hon. Gentleman reiterated this evening in slightly different words that that had been the position. I would like to see what McKinseys have written on this work of the Post Office. When they
§ delved into the Post Office finances they must have found many skeletons in this cupboard and have given the Post Office a lot to think about on whether or not the costs were truly economic. I wonder even today whether there is an operating system by which the costs are properly identified under each specific heading, and I am not convinced by the right hon. Gentleman that this matter has yet been completely and adequately tackled. The Postmaster-General told us that the 999 service cost £½ million a year. It would be interesting to know whether that figure was available before McKinseys had a look at the Post Office.
§
The right hon. Gentleman has reiterated what he said in Committee, that on the agency business the social Ministries will be paying 2 per cent. of the expenditure, and in Committee he went on to say:
There will be a payment, centrally negotiated, which will correspond to the cost of providing the service and will add an amount equivalent to the financial objective that the Post Office is expected to achieve in that particular year."—[OFFICIAL REPORT, Standing Committee D, 28th January, 1969; c. 503.]
§ No formula of what is an adequate payment is written into the Bill. We have only the words of the right hon. Gentleman in Committee and in the House, and an effort should have been made to be more specific. Are we likely, in a couple of years, to be faced with the situation which the Postmaster-General has had to admit arose in the past that proper remuneration has not been obtained for agency services? Is the new system any more effective than the old? I am not satisfied with what the right hon. Gentleman has said. The system is not adequate to reflect the identifiable costs, nor is it adequate in the event of dispute between the parties.
§ For all those reasons, in broad principle I ask my right hon. and hon. Friends to divide the House.
§ Question put, That the Amendment be made:—
§ The House divided: Ayes 141. Noes 185.
225| Division No. 194.] | AYES | [1.28 a.m. |
| Alison, Michael (Barkston Ash) | Atkins, Humphrey (M't'n & M'd'n) | Balniel, Lord |
| Allason, James (Hemel Hempstead) | Awdry, Daniel | Batsford, Brian |
| Amery, Rt. Hn. Julian | Baker, Kenneth (Acton) | Beamish, Col. Sir Tufton |
| Astor, John | Baker, W. H. K. (Banff) | Bennett, Sir Frederic (Torquay) |
| Berry, Hn. Anthony | Higgins, Terence L. | Orr, Capt. L. P. S. |
| Biggs-Davison, John | Hiley, Joseph | Osborn, John (Hallam) |
| Black, Sir Cyril | Holland, Philip | Page, Graham (Crosby) |
| Blaker, Peter | Hornby, Richard | Pardoe, John |
| Body, Richard | Howell, David (Guildford) | Percival, Ian |
| Boyle, Rt. Hn. Sir Edward | Hunt, John | Peyton, John |
| Braine, Bernard | Hutchison, Michael Clark | Pike, Miss Mervyn |
| Brinton, Sir Tatton | Iremonger, T. L. | Pink, R. Bonner |
| Brown, Sir Edward (Bath) | Irvine, Bryant Godman (Rye) | Pounder, Rafton |
| Bruce-Gardyne, J. | Jenkin, Patrick (Woodford) | Powell, Rt. Hn. J. Enoch |
| Bullus, Sir Eric | Johnson Smith, G. (E. Grinstead) | Prior, J. M. L. |
| Burden, F. A. | Jopling, Michael | Pym, Francis |
| Campbell, B. (Oldham, W.) | Kerby, Capt. Henry | Ramsden, Rt. Hn. James |
| Carlisle, Mark | Kershaw, Anthony | Renton, Rt. Hn. Sir David |
| Chichester-Clark, R. | King, Evelyn (Dorset, S.) | Rhys Williams, Sir Brandon |
| Clark, Henry | Kitson, Timothy | Ridley, Hn. Nicholas |
| Clegg, Walter | Knight, Mrs. Jill | Ridsdale, Julian |
| Cooke, Robert | Lambton, Viscount | Rossi, Hugh (Hornsey) |
| Crouch, David | Lane, David | Royle, Anthony |
| Dalkeith, Earl of | Legge-Bourke, Sir Harry | Russell, Sir Ronaid |
| d'Avigdor-Goldsmid, Sir Henry | Longden, Gilbert | Scott, Nicholas |
| Dodds-Parker, Douglas | Lubbock, Eric | Shaw, Michael (Sc'b'gh & Whitby) |
| Drayson, G. B. | MacArthur, Ian | Silvester, Frederick |
| Eden, Sir John | Mackenzie, Alasdair (Ross & Crom'ty) | Smith, John (London & W'minster) |
| Elliot, Capt. Walter (Carshalton) | Maclean, Sir Fitzroy | Speed, Keith |
| Emery, Peter | Macmillan, Maurice (Farnham) | Tapsell, Peter |
| Eyre, Reginald | McNair-Wilson, Michael | Taylor, Sir Charles (Eastbourne) |
| Farr, John | McNair-Wilson, Patrick (NewForest) | Thatcher, Mrs. Margaret |
| Foster, Sir John | Marten, Neil | van Straubenzee, W. R. |
| Fraser, Rt. Hn. Hugh (St'fford & Stone) | Maude, Angus | Waddington, David |
| Gilmour, Ian (Norfolk, C.) | Mawby, Ray | Walker, Peter (Worcester) |
| Gilmour, Sir John (Fife, E.) | Maxwell-Hyslop, R. J. | Walker-Smith, Rt. Hn. Sir Derek |
| Glover, Sir Douglas | Maydon, Lt.-Cmdr. S. L. C. | Weatherill, Bernard |
| Goodhew, Victor | Mills, Peter (Torrington) | Wells, John (Maidstone) |
| Grant, Anthony | Mills, Stratton (Belfast, N.) | Whitelaw, Rt. Hn. William |
| Grant-Ferris, R. | Miscampbell, Norman | Wiggin, A. W. |
| Gresham Cooke, R. | Mitchell, David (Basingstoke) | Wilson, Geoffrey (Truro) |
| Grieve, Percy | Monro, Hector | Winstanley, Dr. M. P. |
| Griffiths, Eldon (Bury St. Edmunds) | Morgan-Giles, Rear-Adm. | Woodnutt, Mark |
| Gurden, Harold | Morrison, Charles (Devizes) | Worsley, Marcus |
| Hamilton, Michael (Salisbury) | Murton, Oscar | |
| Harvey, Sir Arthur Vere | Neave, Airey | TELLERS FOR THE AYES: |
| Hawkins, Paul | Noble, Rt. Hn. Michael | Mr. R. W. Elliot and |
| Hay, John | Onslow, Cranley | Mr. Jasper More. |
| Heald, Rt. Hon. Sir Lionel | ||
| NOES | ||
| Allaun, Frank (Salford, E.) | Dewar, Donald | Howell, Denis (Small Heath) |
| Alldritt, Walter | Dickens, James | Howie, W. |
| Anderson, Donald | Dobson, Ray | Hoy, James |
| Archer, Peter | Dunn, James A. | Huckfield, Leslie |
| Ashton, Joe (Bassetlaw) | Dunnett, Jack | Hughes, Rt. Hn. Cledwyn (Anglesey) |
| Atkins, Ronald (Preston, N.) | Dunwoody, Mrs. Gwyneth (Exeter) | Hughes, Roy (Newport) |
| Atkinson, Norman (Tottenham) | Dunwoody, Dr. John (F'th & C'b'e) | Hunter, Adam |
| Bagier, Gordon A. T. | Eadie, Alex | Hynd, John |
| Barnett, Joel | Ellis, John | Jenkins, Rt. Hn. Roy (Stechford) |
| Benn, Rt. Hn. Anthony Wedgwood | English, Michael | Johnson, Carol (Lewisham, S.) |
| Bidwell, Sydney | Ennals, David | Jones, Rt. Hn. Sir Elwyn (W. Ham, S.) |
| Binns, John | Ensor, David | Jones, T. Alec (Rhondda, West) |
| Bishop, E. S. | Evans, Fred (Caerphilly) | Judd, Frank |
| Blenkinsop, Arthur | Evans, Ioan L. (Birm'h'm, Yardley) | Kerr, Mrs. Anne (R'ter & Chatham) |
| Booth, Albert | Fernyhough, E. | Kerr, Russell (Feltham) |
| Boston, Terence | Fitch, Alan (Wigan) | Lawson, George |
| Boyden, James | Fletcher, Ted (Darlington) | Leadbitter, Ted |
| Bradley, Tom | Foley, Maurice | Lee, Rt. Hn. Frederick (Newton) |
| Bray, Dr. Jeremy | Foot, Michael (Ebbw Vale) | Lee, John (Reading) |
| Brooks, Edwin | Ford, Ben | Lever, Harold (Cheetham) |
| Brown, Bob (N'c'tle-upon-Tyne, W.) | Fowler, Gerry | Lewis, Arthur (W. Ham, N.) |
| Brown, R. W. (Shoreditch & F'bury) | Freeson, Reginald | Lomas, Kenneth |
| Buchan, Norman | Gray, Dr. Hugh (Yarmouth) | Loughlin, Charles |
| Carter-Jones, Lewis | Gregory, Arnold | Luard, Evan |
| Coe, Denis | Griffiths, David (Rother Valley) | Lyon, Alexander W. (York) |
| Coleman, Donald | Griffiths, Eddie (Brightside) | MacDermot, Niall |
| Conlan, Bernard | Griffiths, Will (Exchange) | Macdonald, A. H. |
| Crawshaw, Richard | Hamilton, James (Bothwell) | McGuire, Michael |
| Crossman, Rt. Hn. Richard | Hamling, William | McKay, Mrs. Margaret |
| Davidson, Arthur (Accrington) | Hart, Rt. Hn. Judith | Mackenzie, Gregor (Rutherglen) |
| Davies, Ednyfed Hudson (Conway) | Haseldine, Norman | Mackie, John |
| Davies, Dr. Ernest (Stretford) | Hazell, Bert | Maclennan, Robert |
| Davies, Rt. Hn. Harold (Leek) | Heffer, Eric S. | MacMillan, Malcolm (Western Isles) |
| Davies, Ifor (Gower) | Henig, Stanley | MacPherson, Malcolm |
| Dell, Edmund | Horner, John | Mahon, Peter (Preston, S.) |
| Dempsey, James | Houghton, Rt. Hn. Douglas | Mahon, Simon (Bootle) |
| Mallaliue, J. P. W. (Huddersfield, E.) | Owen, Dr. David (Plymouth, S'tn) | Slater, Joseph |
| Manuel, Archie | Page, Derek (King's Lynn) | Spriggs, Leslie |
| Marks, Kenneth | Paget, R. T. | Stonehouse, Rt. Hn. John |
| Marquand, David | Palmer, Arthur | Taverne, Dick |
| Marsh, Rt. Hn. Richard | Park, Trevor | Thomas, Rt. Hn. George |
| Mason, Rt. Hn. Roy | Pavitt, Laurence | Tinn, James |
| Mayhew, Christopher | Peart, Rt. Hn. Fred | Varley, Eric G. |
| Mellish, Rt. Hn. Robert | Perry, Ernest G. (Battersea, S.) | Wainwright, Edwin (Dearne Valley) |
| Mendelson, John | Price, Christopher (Perry Barr) | Walker, Harold (Doncaster) |
| Mikardo, Ian | Price, William (Rugby) | Wallace, George |
| Millan, Bruce | Probert, Arthur | Watkins, David (Consett) |
| Miller, Dr. M. S. | Rees, Merlyn | Watkins, Tudor (Brecon & Radnor) |
| Milne, Edward (Blyth) | Richard, Ivor | Wellbeloved, James |
| Mitchell, R. C. (S'th'pton Test) | Roberts, Gwilym (Bedfordshire, S.) | Wells, William (Walsall, N.) |
| Molloy, William | Robertson, John (Paisley) | Whitaker, Ben |
| Morgan, Elystan (Cardiganshire) | Robinson, Rt. Hn. Kenneth (St. P'c'as) | White, Mrs. Eirene |
| Morris, Charles R. (Openshaw) | Roebuck, Roy | Wilkins, W. A. |
| Morris, John (Aberavon) | Rose, Paul | Williams, Alan Lee (Hornchurch) |
| Moyle, Roland | Ross, Rt. Hn. William | Williams, Clifford (Abertillery) |
| Murray, Albert | Rowlands, E. | Williams, Mrs. Shirley (Hitchin) |
| Newens, Stan | Shaw, Arnold (Ilford, S.) | Willis, Rt. Hn. George |
| Norwood, Christopher | Sheldon, Robert | Wilson, William (Coventry, S.) |
| Oakes, Gordon | Shore, Rt. Hn. Peter (Stepney) | Wyatt, Woodrow |
| Ogden, Eric | Short, Mrs. Ren½E (W'hampton, N. E.) | |
| O'Malley, Brian | Silkin, Rt. Hn. John (Deptford) | TELLERS FOR THE NOES: |
| Orme, Stanley | Silverman, Julius | Mr. Joseph Harper and |
| Oswald, Thomas | Skeffington, Arthur | Mr. Walter Harrison. |
§ Further consideration of the Bill, as amended, adjourned.—[Mr. Fitch.]
§ Bill, as amended, to be further considered this day.